Realities of being an entrepreneur

by Armando "Butz" Bartolome

Editor's note: The Business Mentor is a weekly business column by Armando "Butz" Bartolome, president of GMB Franchise Developers Inc. and chairman of the Association of Filipino Franchisers Inc.

MANILA, Philippines - To go and venture into a business, one has to be prepared well. There are realities, which need to be explored, studied and remedied. Discouragement is not the proper word but more of facing the challenge.

Here are some areas where entrepreneurs are often faced with challenges:

1. Labor

It is difficult to find the right person for a job. In the country, there are so many job fairs being held. In fact it is almost a year round event. Every year we produce thousands of graduates from different fields. The government has been aggressive in pushing the programs of TESDA.

2. Permits and licenses

Getting the necessary documents for a business may still be a challenging stage. The government is exerting its efforts in streamlining its application process including the time it takes to get permits and licenses. There is the BMBE (Barangay Micro Business Enterprise) Law, which has been around for some time. However, many are not aware of this law, while some local government units are not agreeable to some of its provisions. It may be high time we need to sit down and do the necessary revisions.

3. Taxation

I admire the strong will of the government in implementing changes in the taxation system of the country. We need to make taxes work for the people. The main concern is the entrepreneur's understanding of taxation procedures. Lack of understanding may lead to misguided steps. Perhaps it may be good to have a grassroots campaign on the value of taxation, and make it easier for the general public to understand.

4. Location

The Philippines has many malls, with Sunday is already considered a “malling day” for many Pinoys. Thus for an entrepreneur, to get a business started, malls are where you want to be. Reality speaking, it is challenging to get a spot in the malls. There are certain requirements before a business can establish a shop in a mall.

5. Partnership

Filipinos are fond of getting friends or family to join in their business projects. This is perhaps a way of sharing whatever goodwill or success one may obtain. The challenge is to address everyone's expectations. Agreements among partners may not be well specified. This may be attributed to “nahihiya” (shyness) mentality. I have seen a number who started as best of friends and end up best of enemies.

6. Capital

Getting the business off the ground is one hurdle. The needed capital for an entrepreneur is the much-needed fuel. Applying for a bank loan requires too many paperwork, while interest rates are also too high. What entrepreneurs would do is identify the most basic capital to start the business. Yet even a minimum, the business cannot readily take off.

7. Rental and mandatory requirements

Aside from finding the right locations, the malls have become too expensive for new entrepreneurs. It is understandable the mall developers did put up a bigger investment to have such structures. But there are some malls that impose requirements such as the supply of soft drinks and bottled water, paper cups, etc. There is even a percentage of sales included, which is part or whatever is higher. Can mall developers give even starting or surviving entrepreneurs some breathing space?

8. Family involvement

There are family businesses which are have become successful because of every member’s involvement. Yet there are also enterprises, which were not attended to by children. It is sad to see long time brands, which went into oblivion because of neglect. It may be a challenge to convince and begin selling the business concept to the children.

I am in favor of a free and healthy enterprise. Filipino entrepreneurs are capable of becoming global and competitive. This may be possible if given the proper nurturing and support.

The government is at the period of adjusting and rebuilding. There must be a win- win attitude both from the public and private sector. I believe the key word is to relive the spirit of “Bayanihan”. The Filipino Entrepreneur can and will always succeed.

One example is the seeing the group of entrepreneurs bond and establish an association 16 years ago. The Association of Filipino Franchisers Inc. (AFFI) began because they wanted to reach their goals of becoming world-class.

Today with more than 112 member companies, this group now enjoys and reaps rewards of their labor. Companies like Potato Corner, Lay Bare Waxing Salon, Mang Inasal, Fiorgelato, Sweet Corner, Figaro Coffee are some examples making waves in the foreign shores. They be small but foreigners are greatly impressed by their business concepts.

---For questions and more information, you may contact Armando "Butz" Bartolome by email: [email protected] His website is www.gmb.com.ph